Introduction of NATIONAL BANK OF PAKISTAN:

National Bank of Pakistan (NBP) was established under the National Bank of Pakistan Ordinance 1949. The primary objective of NBP was to purchase jute from the growers in the former East Pakistan and also to perform the commercial banking functions in the country. National Bank of Pakistan is now the biggest financial institution with assets totaling over Rs.310 billion with 14 local and 23 foreign branches. The bank is the higher financer in agriculture and commodity operations. NBP will aspire to the values that make NBP truly the Nations 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 stakeholders value Discharging our responsibility as a good corporate citizen of Pakistan and in countries where we operate

Profile of Industry

TYPES OF BANKS
Primarily all banks gather temporarily idle money for the purpose of lending to others and investments which bring gain in the form of return, profit and dividends etc. However, due to the variety of resources of money and the diversity in lending and investment operations, banks have been placed in various categories, such as commercial banks. Saving Banks, Merchants Banks, Mortgage Banks, Consumer Banks, Investment Bank, Development Banks, Cooperative Banks and Central Banks.

COMMERCIAL BANKS
The commercial banks receive deposits from the general public which irreparable on demand upon written orders of the depositors. As their most distinctive feature the commercial banks maintain checking accounts for the constituents. The commercial banks are also distinguished for providing short term finance to trade, commerce and industry to enable these sectors to expand their productive activities.

MERCHANT BANKS
Merchant banks are those which have been mainly financing the domestic and international trade in United Kingdom. During the late eighteenth and early nineteenth centuries the trade between countries was financed by bills of exchange by well reputed merchant houses for which they would charge a commission for their service. Thus the business of accepting bills of exchange to finance the trade developed and gradually these business houses entered into other banking activities and become known as merchant banks. Since all the commercial banks, in addition to other banking functions, also deal in trade financing, the term merchant banks has gradually faded away.

Saving Banks
The basic purpose of these banks is to inculcate the habit of saving in the people. The saving bank deposits are not repayable upon only the written orders of the depositor but the depositor or his agent has to appear personally at the saving bank to make withdrawal,
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and for this purpose he must present a passbook, a certificate of deposit or some similar documents to prove his right to receive payment. Post Office Saving Banks and Saving Account at National Saving Organization are well known operational Saving Banks in Pakistan.

MORTGAGE BANKS
These banks mainly deal in loans for the acquisition or construction or real estate against the security of mortgages. Quite a few such banks are operating in developed part of the world. Saving and loans associations and farm-loan associations are some of the well known forms of the mortgage banks.

CONSUMER BANKS
These banks provide finance for purchasing consumption goods for the use of the borrowers. Consumer finance companies, sales finance companies and credit unions are some of the popular forms of consumer banks.

INVESTMENT BANKS
The investment banks assist business houses and the governmental bodies to raise money through the sale of stock and bonds for usually long term purposes. These banks perform the usual functions of raising deposits of idle money from the public and finance the business houses and other bodies.

DEVELOPMENT BANKS
These banks have been established to provide long term development finance to the trade, commerce and industry. In Pakistan they are generally government owned banks, established under a specially promulgated law. Zarai Taraqiati Bank Ltd. and Industrial Development Bank of Pakistan is every well-known developments bank.

COOPERATIVE BANKS
These are the banks established and registered as a cooperative venture to provide banking facilities to the members of the cooperative. In Pakistan, the Federal Bank of Cooperatives is well known such bank.

CENTRAL BANKS
Central banks occupy unique position in the banking structure of a country because they have been entrusted with the responsibility of controlling the money supply, interest rates and financial market of the country for the purpose of economic development. State Bank of Pakistan, Bank of England and Federal Reserve Bank of U.S.A. are well has known central banks. (Practice and Law of Banking in Pakistan.

History of BANKING IN PAKISTAN

The partition plan was announced on June 3, 1947 and August 15, 1949 was fixed as the date on which independence was to take effect. It was decided that the Reserve bank of India should continue to function in the dominion of Pakistan until September 30, 1948 due to administrative and technical difficulties involved in immediately establishing and operating central Bank. At the time of partition, total number of banks in Pakistan was 38 out of these the commercial banks in Pakistan were 2, which were Habib Bank Limited and Australia Bank of India. The total deposits in Pakistani banks stood at Rs.880 million whereas the advances wereRs.198 million. The Governor General of Pakistan, Muhammad Ali Jinnah issued the order for the establishment of State Bank of Pakistan on 1st of July 1948. In 1949, National Bank of Pakistan was established. It started with six offices in former East Pakistan. There were 14 Pakistani scheduled commercial banks operating in the country on December 1973, the name of these were: 1. National Bank of Pakistan 2. Habib Bank 3. Habib Bank (Overseas) Limited 4. United Bank Limited 5. Muslim Commercial Bank Limited
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6. Commerce Bank Limited 7. Australia Bank Limited 8. Standard Bank Limited 9. Bank of Bahawalpur Limited 10. Premier Bank Limited 11. Pak Bank Limited 12. Lahore Commercial Bank Limited 13. Sarhad Bank Limited 14. Punjab Provincial Co-operative Bank Limit The Pakistan Banking Council prepared banks amalgamation schemes in 1974 for amalgamation of smaller banks with the five bigger banks of the country. These five banks are as under: 1.National Bank of Pakistan 2.Habib Bank Limited 3.United Bank Limited 4.Muslim Commercial Bank Limited 5.Allied Bank Limited So, through the Nationalization of Bank Act 1974, the State Bank of Pakistan, all the commercial banks incorporated in Pakistan and carrying on business in or outside the country were brought under the government ownership with effect from Jan. 1, 1974. The ownership, management, and control of all banks in Pakistan stood transferred to and vested in the Federal Government. The Finance Minister announced plans to start Islamic Banking system in Pakistan in the budget speech on June 26, 1980, but it could not be possible till August, 2003. Banking is one of the most sensitive businesses all over the world. Banks play very important role in the economy of a country and Pakistan is no exemption. Banks are custodian to the assets of the general masses. The banking sector plays a significant role in a contemporary world of money and economy. It influences and facilitates many different but integrated economic activities like resources mobilization, poverty
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elimination, production and distribution of public finance. It is purchase of car or building of a home banks are always theyre to serve you better. It is play ground or any educational or healthy societal activities the money of banks nurtures them. It is an industrial project or agricultural development of the country the sponsor-ship of banks is very much involved. Banks play very positive and important role in the overall economic development of the country. Pakistan has a well-developed banking system, which consists of a wide variety of institutions ranging from a central bank to commercial banks and to specialized agencies to cater for special requirements of specific sectors. The country started without any worthwhile banking network in 1947 but witnessed phenomenal growth in the first two decades. By 1970, it had acquired a flourishing banking sector.

Comparative Study of Domestic Banking Industry

Nationalization of banks in the seventies was a major upset to domestic banking industry of the country, which changed the whole complexion of the banking industry. With irrational decision at the top all the commercial banks were made subservient to the political leadership and the bureaucracy. Specialized banking institutions were already working in the public sector. The new accountability paradigm changed the business ethics in the banking industry, and with this change started the disaster. Nationalization of banking industry was accompanied by violent changes in the external value of rupee. The commercial banks thus lost their assets management equilibrium, initiative and growth momentum. They ceased to be a business concern and became big bureaucracies. This was accompanied by indiscreet loaning under political pressure. They suffered from three terminal diseases: non-performing loans; higher intermediation cost; and loss of initiative and entrepreneurship. The rise to Labor Unions and Officers Associations made life tough and working conditions ugly to honest, dedicated and industrious workers in the realms of domestic banking industry. The era of nineties was the climax of privatization, deregulation and restructuring in the domestic banking industry and financial institutions. The Muslim Commercial Bank was the first bank to privatize. Followed by Allied Bank limited, United Bank Limited and
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now the Habib Bank Limited have been privatized. One thing good for that particular period was the recruitment of fresh officers in the domestic banking industry through well-organized policies of Banking Council. With the decay of Banking Council there was flood of insincere, nonprofessional, incompetent candidates directly appointed recruited in all the domestic banks of the country.

Public Sector Commercial Banks

National Bank of Pakistan First Women Bank Limited The Bank of Khyber The Bank of Punjab NBP FWB KB BOP

The government of Pakistan permitted small private sector banks to operate, which indulged in doubtful policies to promote business. The public sector banking, which constituted the backbone, thus continued to suffer because of their approach, size and carried over liabilities. Mehran Bank is the prime example of that kind of lax banking in the country, which ultimately merged into National bank of Pakistan i.e. last resort of domestic banking industry.

Local Private Banks

Askari Commercial Bank Limited Bank Al-Falah Limited Bank Al Habib Limited Bolan Bank Limited Faysal Bank Limited Metropolitan Bank Limited Platinum Commercial Bank Ltd Prime Commercial Bank Limited Saudi Pak Commercial Bank Ltd PICIC Commercial Bank Limited Soneri Bank Limited Union Bank Limited Muslim Commercial Bank Limited
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Allied Bank of Pakistan Union Bank Limited Mashreq Bank In the meanwhile, western banks started entering into the business. They, with the support of ruling elite, concentrated on the big business, leaving the routine business to the local banks. This reduced the profitability of the local banks.

Foreign Banks
ABN Amro Bank Al Baraka Islamic Bank American Express The Bank of Tokyo Mitsubishi CITI Bank Credit Agricole Indo Suez Deutsche Bank Doha Bank Emirates Bank Habib Bank A. G. Zurich Hong Kong Shangai Banking Corporation IFIC Mashreq Bank PJSC Oman Bank Rupali Bank Standard Chartered Bank

Specialized Banks

Zari Tarqiati Bank Ltd. Industrial Development Bank of Pakistan Punjab Provincial Cooperative Bank Limited There are 17 listed banks in Pakistan 2004. Four banks are still not listed, which are Habib Bank, United Bank, Allied Bank of Pakistan, Dawood Bank. Standard Chartered Bank, Citibank, Deutsche Bank and ABN AMRO Bank are main foreign banks in the country. These four banks continue to enjoy a significant share in the market, both in
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terms of deposits and advances. All the foreign banks of the country are busy to invest heavily in the field technology and e-commerce in order to overcome branch limitation. All the foreign banks have been busy to introduce new products and idea to grab larger proportion of the local markets. Foreign banks are carrying major proportion of local business in credit cards, consumer finances and housing finance. Many domestic banks have increased their general standards. Ours is the age of plastic money. Internet-based services are constantly increasing the number of ATM machines, either by installing their own machines or making arrangements with other networks. The number of Debit Cards has also been increasing at an unprecedented rate. All the domestic and foreign banks vigorously institutionalized consumer financing in the country and earned handsome profits. The borrowing to private sector has also increased which ultimately boasted the profitability of all the domestic banks of the country. In the last 3 to 4 years many domestic banks have been suffering from surplus liquidity crisis mainly due to low demand for credit and slowdown of manufacturing sector in the country. Almost all the banks are now buy to invest in capital markets to increase their exposure in equities. To stop that risky trend the State Bank of Pakistan issued the instructions to follow the Prudential Regulations in letter and spirit and not invest in the capital markets beyond the limits. The domestic banks lending under consumer finance and housing finance has also been growing. The analysis of Annual Reports of banks shows that their income from core banking activities has been growing. The other positive point is that there are growing expectations for increase in interest rates.

Comparative Analysis Comparative Analysis of Domestic Banking Industry of Pakistan (Rs. million)
Bank ACB BAH Deposit 51,732 34,240 Advances 30,035 23,775 Investments 26,759 18,831
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Bop BB FB UNION BANK KB MB Metro MCB NBP PCB PB SPB SB UB UBL

23,767 7,761 24,554 328,182 2,640 5,079 28,515 182,706 362,866 21,155 14,640 12,341 20,545 37,760 154,915

6,621 3,298 21,935 167,523 490 3,532 19,444 78,924 140,547 10,876 9,016 8,522 11,378 28,890 74,117

8,295 1,328 6,842 142,877 2,118 856 15,013 89,610 143,525 10,306 7,534 6,365 9,844 11,822 69,385

Marketing Analysis Market Recognition:

For the second consecutive year, NBP was recognized as the best bank in Pakistan by the prestigious periodical, The Banker" UK (a subsidiary of Financial Times Group). Furthermore M/s JCR-VIS Credit Rating Company Limited maintained its rating of AAA, while the standalone rating was raised by one notch to AA-, which is one of the highest in the banking sector.

Future Outlook
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The reduction in the interest rate environment will overall have a negative impact on the financial sector's profitability in the short term. To meet these challenges we will focus on building our loan portfolio, both on corporate and retail side. On the retail side focus will be on additional fee business while maintaining stringent controls over cost. Longer term we will be focusing on those sectors in the country, which have traditionally received less attention from the financial sector, i.e. agriculture, small and medium enterprises and of the entire range of retail products. Our key strength remains our customer base of over 9 million and we are confident that we are positioned to capitalize on the opportunities.

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Profile of the Company

Introduction Of NATIONAL BANK OF PAKISTAN

National Bank of Pakistan (NBP) was established under the National Bank of Pakistan Ordinance 1949. The primary objective of NBP was to purchase jute from the growers in the former East Pakistan and also to perform the commercial banking functions in the country. National Bank of Pakistan is now the biggest financial institution with assets totaling over Rs.310 billion with 14 local and 23 foreign branches. The bank is the higher financer in agriculture and commodity operations. NBP will aspire to the values that make NBP truly the Nations Bank, by: Institutionalizing a merit and performance culture

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 Creating a distinctive brand identity by providing the highest standards of services Adopting the best international management practices Maximizing stakeholders value Discharging our responsibility as a good corporate citizen of Pakistan and in countries where we operate

Vision
To be the pre-eminent financial institution in Pakistan and achieve market recognition both in the quality and delivery of service as well as the range of product offering

Mission Statement
To be recognized in the market place by Institutionalizing a merit & performance culture, Creating a powerful & distinctive brand identity, Achieving top- tier financial performance, and Adopting & living out our core values

Developments
All the organization whether public or private which are involved in business carries the objective of profit earning and profit maximization. National Bank of Pakistan is also a business organization and its main objectives are profit maximization. National Bank of Pakistan its profits in tow ways.

Top Management of National Bank of Pakistan

Sr .No 1 2 3 4 5 Name Qamar Hussain Doctor Asif Brohi Shahid Anwar Khan Ziaullah Khan Dr. Mirza Abrar Baig Designation President Group Chief Commercial And Retail Banking Group Group Chief Credit Management Group Chief Asset Recovery Group Chief Human
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6 7 8 9 10 11 12 13 14

Nausherwan Adil Tariq Jamali Nadeem A. Ilyas Syed Iqbal Ashraf Muhammad Nusrat Vohra Ekhlaq Ahmad Aamir Sattar Mahmood Siddique Aamir Abbasi

Resources Management Group Chief Group Operation Group Chief Compliance Group Chief Corporate & Investment Banking Group Chief Overseas Banking Group Chief Treasury Management Secretary Boards of Directors Financial Controller CO IT Division Divisional Head Corporate communication

Information about Branch

NBP is a supervisor and very cooperative to the branch offices. Main branch supply needed equipments and manages cash etc for the branch office. It also guides other branches on different issues through telephony, circulars etc. The employees which are working in different departments as follows

Sr. No 1 2 3 4

Name Muhammad Alyas Ameer Hussain Chisti Asif Ali Mughal Mukhtar Ahmad

Designation A.v.p Manager OG 2 Operation Manager OG 3 Credit Officer OG 1 Head Officer

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5 6 7 8

Mouzam Ali Khichi Sanaullah Abdul Razaq Muhammad Anwar

OG 3 (CFO) Cashier Ground Keeper Messenger

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Industry Business Process

The ownership and control of all commercial banks were taken over by the Government of Pakistan January 1st 1974. A banking council was founded under the Nationalization Act 1974. The banking council was set up for making policy recommendations to federal Government formulating policy guidelines for the bank and their organization
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The management and the organization structure of the nationalized banks have uniformity. This management and organization structure is briefly described as under 1. Board of Directors 2. Executive Boards 3. Chief Executive 4. Divisional Chiefs 5. Provisional Chiefs 6. Circle Executives 7. Zonal Heads 8. Branch Managers

1. Board of Directors
In the management of the banks, the board of director at the top of controlling body. Since there are no private share holders now, so there is no general meeting of the shareholders and no elected directors. The BOD consists of a nominated President, Secretary and 9 other members. The board has limited administrative power because after the Nationalization Act 1974, most of powers are transferred to the Banking Council and Executive Board 2. Executive Board The general direction and supervision of the affairs of commercial banks lies in their respective Executive Boards. An EB also consists of a President, a Secretary, and 9 other members, appointed by the Federal Government.

3. Chief Executive
The President of the Executive Board is the Chief Executive. He is the administrative head of a bank and presides over the meetings of Executive Board. 4. Divisional Chiefs
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In order to improve the management and operation of a bank, it has been split up into a numbers of divisions. Each division of a bank is placed under the supervision and control of Divisional Chief (also called the Senior Executive Vice President or Executive Vice President)

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

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

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

8. Branch Managers
Each zone of commercial bank is divided into several branches. The control and supervision of each branch is mostly entrusted to Assistant Vice President or Officer G-I.

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Company Business Process

In this section a number of topics are discussed. The major topics of this section are: Functions of National Bank of Pakistan
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Cash Department Deposit Department Clearing Department Advances and Credit Department Securities Types of Advances Other Services

Different schemes conducted by NBP

National Bank of Pakistan is a commercial bank, in modern time it plays a very vital role and its functions are manifold. The main functions are as under: 1 Accepting various types of deposits. 2 Granting loans and advances. 3 Undertaking of agency services and also general utility functions, few of these are as under:Collecting cheques and bills of exchange for the customers. Collecting interest due, dividend, pensions, and other sum due to customers. Providing safe custody and facilities to keep jewellery, documents, and securities etc. Transfer of money from place to place. Acting an executor, trustee or attorney for the customers. Issuing of travelers, cheques and letters of credit to give credit facilities to travel. Accepting bills of exchange on behalf of customers. Purchasing shares for the customers. Undertaking foreign exchange business. Furnishing trade information and tendering advice to customers. For proper functioning of all these activities, the bank has divided its operations into different departments that would be discussed next. These departments are as under: 1) Cash Department 2) Deposit Department
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3) Clearing Department 4) Advances and Credit Department 5) Remittance Department 6) Foreign Exchange Department

CASH DEPARTMENT
The following books are maintained in the cash department:Receiving Cashier Books Token Book Paying Cashier Book Scroll Books Cash Balance Book When cash is received in counter, it is entered in the Scroll Book and Receiving Cashier Book. At the close of the day, these are balanced with each other. When the cheque or any negotiable instrument is presented at counter for payment, it is entered in the Token Book and Token is issued to the customer. The Token and the cashier make entry in the Payment Book and the payment is made to payee. At the close of the day, the Token Book and paying Cashier Book is balanced. The consolidated figure of receipt and payment of cash is entered in the Balance Book and drawn closing balance of cash. OPENING BALANCE + RECEIPT PAYMENT = CLOSING BALANCE This is very important department because cash is the most liquid asset and mostly frauds are made in this department, therefore, extra care sis taken in this department and no body is allowed to enter or leave the area freely. Mostly, cash area is grilled and its door is under the supervision of head of that department. Officer checks the books maintained in this department.

DEPOSIT DEPARTMET
IMPORTANCE Bank deals in money and they are merely mobilizing funds within the economy. They borrow from one person and lend to another, the difference between the rates borrowed and lend from their spread or gross profit. Therefore, we can rightly state that deposits are
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the blood of the banks which cause the body of an institution to get to work. These deposits are liability of the bank so from the viewpoint of bank we can refer to them as liabilities.

TYPES OF DEPOSITS
Deposits can be segregated on two bases, one is the duration in which these funds are expected to be with the bank, and second is the cost of getting these funds. So we can divide deposits into two classes according to duration:

Demand Deposits
And on the basis of the cost of acquire these funds, a deposit can be classified as any one of the following four: High Cost Medium Cost Low Cost No Cost Bank has different kind of deposit schemes in order to induce deposits. These schemes area mixture of the above mentioned two types of deposits with and addition of different services and requirements, mode of transactions, basis for calculation of profit, deduction, additional benefits, and eligibility for different groups. In the similar fashion, national Bank of Pakistan has large variety of deposit schemes and some of these are as follows:

1. CURRENT ACCOUNT In this type of accounts, the client is allowed to deposit or withdraw money as and when he likes, but there is requirement of maintaining the minimum balance of Rs.5000/- other wiseRs.50/- will be deducted every month. Usually the businessmen open this type of account and the bank pays no profit on it. These types of deposits are also exempt from

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compulsory deduction of Zakat.

2. PLS SAVING BANK ACCOUNT

This type of account is for those persons who want to make small savings. This type of account is opened with a minimum deposit if Rs.200/- If the balance in the account falls below the minimum requirement then a flat charge of Rs.150/- is made in the account once in a half year. Zakat and other withholding taxes are deducted as per rules of the government.

3. FIXED DEPOSITS
In this type of account a certain amount is deposited for a certain period such as six months, one year, two year or longer. A fixed deposit receipt is issued in the name of the depositor. The receipt is signed by the officer in charge and the bank manager. A notice is given to the depositor on a prescribed from two weeks before the Fixed Deposit Receipt (FDR) falls due, requesting the depositor to withdraw his money or to renew his deposits. The interest is allowed on fixed deposit varies with the period for which the deposit is made. 4. SHORT NOTICE TERM DEPOSIT This kind of deposit is for a short period as the name indicates. The depositor may withdraw his deposit at any time by giving seven days notice to the banker. This type of deposit facilitates the trader to withdraw his amount with interest of the deposited

5. CALL DEPOSIT
Call Deposits are the sorts of deposits, which are deposited with the banker against any tender. This is with out interest deposit, this may be with interest provided with the depositor has agreed to keep this amount with the banker for some fixed period.

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6. CUMULATIVE DEPOSIT CERTIFICATE

This is just like of fixed deposit. In this kind of deposit, the rate of interest is higher as compared to other kind of deposits, which are mentioned previously. The rate of interest rises gradually as the period extends. Its period ranges from three month to twenty years.

7. MONTHLY INCOME SCHEME

National Bank of Pakistan has also introduced Monthly Income Scheme for the benefits of its customers. An individual or institution, company, corporation etc. can take the advantage of this scheme.

LEDGERS OF DEPOSIT DEPARTMENT

The following types of ledgers are concerned with deposit department: Saving Ledgers Current Ledgers Profit and Loss Sharing Ledgers Fixed Deposit Register Cumulative Deposit Certificate Register Cash Book Daily Profit and Loss Summary Book Voucher Register

CLEARING DEPARTMENT
Every bank acts in two way i.e. 1. Paying Bank 2. Collection Bank Here in theory no legal obligation on a banker to collect cheques, drawn up to other

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banks for a customer. It is however, an important function of crossed cheques. A large part of this work is carried out though the bankers clearing house wherever it is established.

Clearing House
A clearing house is the place where representatives, of all the banks get together for the purpose of offsetting the inter bank indebtedness arising from the transfer of deposits by a customer of a particular bank to another bank.

Functions of Clearing Department

The following are the main functions of clearing department. 1. To accept transfer deliveries and clearing cheques from the customer of the branch and to arrange for their collection. 2. To arrange the payment of cheque drawn on the branch and given for collection to any other branch of National Bank of Pakistan or any other members, or sub-members of the local clearing house. 3. To collect amounts of cheques drawn on members, sub-members of the local clearing house, sent for collection by those National Bank Limited branches which are not represented the local clearing house.

Procedure of Depositing Cheques in Clearing House

Whenever a customer wants to deposit cheque, etc, he fills a pay in slip and hands it over the counter along with the instruments he wants to deposit with bank. As far as possible, the customer desire that on of the staff member fill in a slip for him, he should be obliged promptly. The smaller portion of the perforated pay in slip is handed over to the depositor and the portion becomes the regular portion of Credit. .

Transfer Cheques
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Transfer cheques are those cheques, which are collected and paid by the same branch of bank.

Transfer Delivery Cheques

Transfer Delivery cheques are those cheques, which are collected and paid by two different branches of a bank, situated in the same city.

Clearing Cheques
Clearing cheques are those cheques in which the payee (Person who deposit cheques for collection) and the drawer of a cheque maintain the account with different banks.

Scrutiny of Cheque
When the cashier receives the cheques, which are to be deposited for clearing purpose the following points must be verified. The instrument should be neither stale nor post dated. If the instruments is crossed, not negotiable, it can be for the third party (can be endorsee of an order cheque, or a holder of bearer cheque) The instrument should not bear any unauthorized alteration. The amount in words and figures should be the same. The instruments should be drawn on a member, or any of local branches. If the cheque is crossed account payees. Account payee only or Payees Account, it should be accepted for collection for the payees account. The cheques or drafts should not be crossed specially to any other bank. A cheque payable to one of the joint account holder should not be collected for the joint account without the payees endorsement, or consent. A cheque payable to a firm should not be accepted for credit to a partners account. A cheque drawn by a customer in the capacity of an agent. Attorney, or Manager of his company or firm, should not be collected for credit to his personal account. Pay orders, although negotiable, should not be collected for third parties. Do not collect an instrument in the account of an agent, or of the servant of the payees of

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endorsee of the instruments. Mail transfer Receipts pay ships and treasury receipt should not be collected for persons other than the Payee. If an account is new, or the balance or operation of the account is not satisfactory, satisfy yourself about the titles of the customer to the instruments before the titles of the customer to the instrument before accepting the deposit. Brach agents permission should be obtained before accepting a third party cheque or draft for creditor the account of the staff member. If the payee is a government department, government official, or a trust account, the instrument cannot be collected, but of the payees account. If the payee of an instrument is NBP, it can collected for credit of the drawers account, or the amount of the instrument may be utilized as desired be the drawer in writing. Cheque payable to a trust, account should not be collected for credit to at trustee account. All the endorsement should be regular, and on endorsement should be missing. After the cashier scrutinizes the cheques he must also scrutinize the pay in slip.

Scrutiny of Pay-In-Slip
Following steps are involved in the scrutiny of pay in slip. 1. On both the counterfoil and the pay in slip following should be checked. I. Date of Deposits 2. Account number 3. Title of the account 4.The cheque/number and the drawer bank/name. 5. Total amount in words and figures 6. Customer should use separate pay in slip for transfer, transfer delivery, and clearing cheques. 7. The amount noted should be the same as the amount of the instruments, and the amount in words and figures should be same.

PROCEDURES AFTER SCRUTINIZING

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After scrutinizing the cheques and other deposit instruments and paying slip at the counter the following procedure is under taken by cashier if he is satisfied. 1. Fixing the stamp. 2. Scrutiny, and receipt by the authorized officer 3. Returning the counter foil to the depositor. 4. Certificates and confirmation by the officer-in charge of the department. 5. Separating the cheque into transfer delivery, and clearing cheque.

ADVANCES AND CREDIT DEPARTMENT

The function of Advances and Credit Department is to lend money in the form of clean advances, against the promissory note, as well as secured advances against tangible and marketable securities. The bankers prefer such securities, which do not run the risk of general depreciation due to market fluctuations. Common securities for the bankers advances are as under:

SECURITIES 1. GUARANTEES:
When an application for an advance can offer any tangible security, the banker may rely on personal guarantees to protect himself against loss on advances or overdraft to the applicant.

2. MORTGAGE
A mortgage is the transfer of an interest in specific immoveable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, and existing of future debt, or the performance of an engagement, which may rise to a particular liability. The person in whose interest the property is transfer is called mortgage.
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3. HYPOTHICATION
When property in the shape of goods is charged as security for a loan from the bank, the ownership and possession is with the borrower, the goods are said to be hypothecated. This sense of hypothecation is that neither the property in goods nor the possession of them passes to the lender, but the security is granted by means of letter of hypothecation which usually provides for a bankers charge on the hypothecated goods.

4. PLEDGE
In a pledge, the ownership remains with pledged (borrower), but the pledge has the possession of property until the advance is repaid in full. While in case of defaulter the pledge has the right of sale after giving due notice.

Types of Advances
1. Demand Finance (Ordinary Loans) 2. Running Finance (Overdraft) 3. Cash Finance 4. Small Finance 5. Finance against Bills 6. Agriculture Loans

1. DEMAND FINANCE (ORDINARY LOANS)

These are those advances which are allowed in lump sum for a fixed period and are repayable in lump sum or gradually in installments.

2. RUNNING FINANCE
Running finance are advances, which are gradually given to meet temporary requirements of the customers. A good customer uses the banks running finance limit, as a mean of protecting his credit in the market and as a line of second defense to meet his commitments. There are two types of running finance:
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UN-SECURED Under this type of overdraft, the bank relies upon the personal security of the customer or customers account.

SECURED Under this type of overdraft, the bank allows his customer to withdraw more than his deposit after giving security against the amount overdrawn. The securities against which they are given are as under: Share Certificates Savings Certificates Deposits Mortgage Property Guarantee of a person

3. CASH FINANCE
These types of loans are given against the following: Against locally manufactured goods Cash finance against rice and paddy Against pledge Against commodities Besides advances against the above commodities bank may be approached by parties for advances against other commodities like tobacco, oil, etc. Against Trust Receipts

4. SMALL LOANS
Loans are allowed to contractors clearing and forwarding agents. These loans are repayable with in a year.

5. FINANCE AGAINST BILLS

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The advances are allowed both on local and foreign bills such as: Bill of Exchange and Invoices Bill of Landing

6. AGRICULTURE LOANS
Agriculture loans are given to the farmers with holding up to 25 acres for meeting their short medium and long term production requirements such as: Agriculture inputs Tractors instruments Tube wells Live stock farming Land Improvement

Information Technology & Telecommunications Department

The main tasks of the Information Technology & Telecommunications Department are: planning, supervising, and managing the entire range of undertakings related to the IT application at the NBP. In particular, the Department's tasks are as follows: 1. Managing and supervising the IT development at the NBP Drawing up, in cooperation with other organizational units of the NBP, the plans of the development of IT application at the NBP. Constant assisting and advising to organizational units of the NBP in the preparation of projects that require IT applications, as well as the essential supervising of their accomplishment. 2. The development of the data communications system at the NBP Analyzing, making projects, implementing, controlling of the IT systems set up by both, own IT employees and in cooperation with external firms. Participating in standard-setting activities in the IT area and cooperating with public administration bodies in constructing the data communications systems.

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3. Providing protection for the data communications systems Cooperating with the Security Department in developing the security requirements for the data communications systems of the NBP fulfilling the requirements of the security policy.Constant controlling and monitoring of the data communications systems in order to ensure their permanent performance.

4. The operation of the data communications system

Supervising the operation of the main and backup data communications systems. The administration and maintenance activities in the data communications system environment and technical and operational servicing of the IT and telecommunications equipment in all organizational units of the NBP. Operational servicing of the SWIFT system and authentication of telegraphic keys in the communications with foreign institutions.

Organizing events in order to improve job qualifications of the NBP employees

Organizing, in cooperation with the Personnel Department and other organizational units of the NBP, of the specialized IT training courses.

1. Developing in the area of data communications

plans of investments, repairs, and maintenance plans of provision

OTHER SERVICES
UTILITY BILLS COLLECTION: For the convenience of the customer, National Bank of Pakistan also collects different kinds of utility bills such as Electricity Bills, Sui-Gas Bills, Telephone Bills etc.

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NBP PAK RUPEE TRAVELER CHEQUE NBP Pak Rupee traveler Cheque is better than cash, because you get the power to purchase as well as your money can be refunded in case you would loss your cheque. It is a safe and convenient way of purchase. FOREIGN CURRENCY ACCOUNTS Launched to attract deposits in foreign currencies like US Dollars, Pound Sterling, Dutch Mark, and Japanese Yen. Whether you are a resident or a non-resident of Pakistan, NBP invites all to operate in a foreign currency account. DIFFERENT SCHEMES CONDUCTED BY NBP National Bank of Pakistan always makes efforts to improve its goodwill in the general public. It introduces different kind of schemes time to time. The most popular schemes conducted by NBP are as under: Hajj Mubarak Scheme NBP Advance Salary Scheme Fund Management Scheme LG TV Scheme 1. HAJJ MUBARAK SCHEME For the convenience of a person with a limited income who desire to perform Hajj, Hajj Mubarak Scheme is introduced. Moreover, National Bank of Pakistan process the Hajj applications of thousands of people successfully more than any other bank in Pakistan.

2. NBP ADVANCE SALARY SCHEME Do you need urgent funds? If yes then head to National Bank of Pakistan and avail NBP Advance Salary Scheme, which allow you to draw three months salary in one go. This facility is available to permanent employees of the:Federal and Provincial governments Semi-governments, autonomous, semi-autonomous,
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local bodies, and government corporations other corporations approved by NBP No guarantee, collaterals, or insurance is required to avail this scheme. NBP gives the facility to repay the excessive amount within 1 to 36 months. The procedure is very easy, just fill the application form and choice between 1 to 36 months and take your NBP Advance Salary within 3days after submitting your form. 3. FUND MANAGEMENT SCHEME This scheme is offered to corporate under customer and is aimed at providing better rate of return up to 15% per annum. One of the objectives of the scheme is to develop the secondary market for government securities.

4. LG TV SCHEME It is the most popular of NBP schemes for the year 2003. NBP incorporates with LG Appliances Corporation. If you want a TV set but have not enough money to purchase it then head to NBP, fill an application form of LG TV Scheme. NBP gives you the facility to pay for the TV set in smaller installments during a time period of 2 years. Any one can avail this scheme. Two government employees are required to present the witness to repay the loan if the applicant is unable to repay the loan or the applicant should have the Fixed Term Deposit in NBP more worthily than the amount advanced to the applicant and it should have the duration of more than two years.

Products of National Bank of Pakistan Agriculture Farming Program

Competitive mark-up rate. Quick & easy processing. Provision of technical guidance to farmers at their doorstep. Wide range of financing schemes for farmers.
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Finance facility up to Rs. 500,000/- for landless farmers on personal guarantee. Financing available against Pass Book, Residential / Commercial property, Gold ornaments and paper security. Loan facility on revolving basis for three years (renewable on yearly basis without abstention of fresh documentation and approval).

BRIEF ABOUT STUDENT LOAN SCHEME

Pursuant to the announcement made by the Federal Finance Minister in his 2001-2002budget speech, a STUDENTS LOAN SCHEME (SLS) for Education was launched by the Government of Pakistan in collaboration with major commercial banks of Pakistan (NBP, HBL, UBL, MCB and ABL). Under the Scheme, financial assistance is provided by way of Interest Free Loans to the meritorious students who have financial constraints for pursuing their studies in Scientific, Technical and Professional education within Pakistan.

PLS Saving Account

Earn up to 8.50% p.a. +. Minimum saving balance of Rs. 20,001/- & a maximum balance of Rs. 1 million*. Free NBP Cash Card (ATM + Debit). Convenience of NBP Online Aasan Banking (for online banking customers). Two debit withdrawals allowed in a month & no limit on number of deposit transactions. Profit calculated on monthly and paid on half yearly basis.

NBP Protection Shield

Personal Accident Insurance No documentation No medical required Premium Auto Debit facility & choice of deactivation Coverage includes death due to: Natural Calamities e.g. Earthquake, Flood, Cyclone etc.
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Accident Riots Civil Commotion Strikes Acts of Terrorism NBP Protection Shield NBP Protection Shield (Life is Precious)

NBP Pak Remit

This service is available to U.S. residents for sending money to their family and friends in Pakistan. One must have a valid US Dollar account with a U.S. bank or a US Dollar credit or debit card in order to remit funds through this channel. Remitters in USA can log on to our user friendly website, www.pakremit.com and easily remit funds to Pakistan from the comfort of their homes, in a matter of minutes. The service is fully secure with advance encryption application and is available for use 24 hours a day, 7 days a week. Fees and exchange rate have been set at competitive levels and the remitters have the ability to track delivery of funds as well.

NBP Investor Advantage

Easier Financing, Profitable Tring Financing Facility for Stock Investadors Comfortable environment for trading No security requirement, except for the customers equity Customers equity freely available for investment Equity acceptable in cash or approved shares

NBP Cash and Gold

Ready Cash against Gold Meet your need for ready cash against your Idle gold jewelry with no minimum limits Get extra benefit From Your Gold

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NBP Saiban
Open the door youre Dream Home Home Financing Home Purchase Home Construction Home Renovation Purchase of Land + Construction Balance Transfer Facility (BTF)

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Company Departmental Functions

NBP different departments are such as:

Cash Department Deposit Department Clearing Department Advances and Credit Department Securities Types of Advances Other Services

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Cash Department The following books are maintained in the cash department:Receiving Cashier Books Token Book Paying Cashier Book Scroll Books Cash Balance Book When cash is received in counter, it is entered in the Scroll Book and Receiving Cashier Book. At the close of the day, these are balanced with each other. When the cheque or any negotiable instrument is presented at counter for payment, it is entered in the Token Book and Token is issued to the customer. Deposit Department Bank deals in money and they are merely mobilizing funds within the economy. They borrow from one person and lend to another, the difference between the rates borrowed and lend from their spread or gross profit. Therefore, we can rightly state that deposits are the blood of the banks which cause the body of an institution to get to work. Clearing Department Every bank acts in two way i.e. 1. Paying Bank 2. Collection Bank Here in theory no legal obligation on a banker to collect cheques, drawn up to other banks for a customer. It is however, an important function of crossed cheques. A large part of this work is carried out though the bankers clearing house wherever it is established. ADVANCES AND CREDIT DEPARTMENT The function of Advances and Credit Department is to lend money in the form of clean advances, against the promissory note, as well as secured advances against tangible and marketable securities. The bankers prefer such securities, which do not run the risk of
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general depreciation due to market fluctuations. Securities Types GUARANTEES MORTGAGE HYPOTHICATION PLEDGE

TRAINING Participation
Work performed by me I joined National Bank of Pakistan, Main Branch Chishtian on 10 April 2011.First day, the manager introduced me about the functioning of the branch and the staff. The manager told me that counter is the most important place of the bank. During the six weeks of my internship, I worked in different sections of the branch and did the maximum practice of banking system details of which is as under:

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

CHEQUE AT COUNTER
A cheque to withdraw the amount is presented on the counter with the following requisites: Name of the Account Holder Current or previous date Amount in figures Amount in wording
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One signature of the account holder in the right bottom corner of the cheque and two signature of the bearer on the back Branch Stamp in front of the cheque If the Account Holder uses thumb instead of signature then the Pass Book is necessary with the cheque Operations officer checks and verifies all these requisites. If it fulfills all the requisites, it is forwarded for payment after a certain procedure. CHEQUE PAYMENT PROCEDURE After all the requisites are verified and then the excessive balance is checked and prescribed amount is deducted narrated on the cheque, then signature verified stamp in case of signature only on the signature and a pay cash stamp are fixed and a Token is given to the cheque bearer after writing Token No. on the specified cheque. Then the Officer G-II verified the cheque and forwarded it to the cashier where the cheque bearer receives the amount from the account. BILLS & TAX COLLECTIONS DEPARTMENT I spent second week of my training in bills collection department. Mr.Nasir is the in charge of this section. Here we collected utility bills like electricity bills, gas bills, telephone bills and also collected chalans of income tax and sales tax of different companies. And I worked on income tax and sales tax online collection for two weeks.

BILL REMITTANCE DEPARTMENT

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

DEPOSIT DEPARTMENT
Deposit department deals with Current, Savings, and Fixed Accounts. In current account the bank does not give any interest and you can deposit the whole amount in lump sum in
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business hours. However in PLS savings account we can only withdraw up to Rs.25000/without any notice otherwise a prior notification of a week is required to the bank if the amount to be withdrawn is more than Rs.25000/- Old ages are interested in Fixed Account usually. The rate of interest is higher more than that of in Current and PLS savings Account but the amount cannot be withdrawn before a specific time fixed by the client. To open the account customer have to fulfill an application form and submit to the concerning authority. In Current and PLS saving Account, a Cheque Book is issued to the client and he becomes the Account Holder of NBP. I worked in this department for one week.

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SWOT Analysis of Industry

STRENGTHS
1. Policy makers have made some notable changes in policy and regulation to help strengthen the sector. These changes include strengthening prudential norms, enhancing the payments system and integrating regulations between commercial and cooperative banks. 2. Bank lending has been a significant driver of GDP growth and employment. 3. Extensive reach: the vast networking & growing number of branches & ATMs. Indian banking system has reached even to the remote corners of the country.

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4. The government's regular policy for Pakistani bank since 1969 has paid rich dividends with the nationalization of 14 major private banks of Pakistan 5.In terms of quality of assets and capital adequacy, Pakistan banks are considered to have clean, strong and transparent balance sheets relative to other banks in comparable economies in its region. 6. Foreign banks will have the opportunity to own up to 74 per cent of Pakistan private sector banks and 20 per cent of government owned banks.

WEAKNESSES
1.It needs to fundamentally strengthen institutional skill levels especially in sales and marketing, service operations, risk management and the overall organizational performance ethic & strengthen human capital. 2. Old private sector banks also have the need to fundamentally strengthen skill levels. 3. The cost of intermediation remains high and bank penetration is limited to only a few customer segments and geographies.

4.Structural weaknesses such as a fragmented industry structure, restrictions on capital availability and deployment, lack of institutional support infrastructure, restrictive labour laws, weak corporate governance and ineffective regulations beyond Scheduled Commercial Banks (SCBs), unless industry utilities and service bureaus. 5. Refusal to dilute stake in PSU banks: The government has refused to dilute its stake in PSU banks below 51% thus choking the headroom available to these banks for raining equity capital. 6. Impediments in sectoral reforms: Opposition from Left and resultant cautious
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approach from the North Block in terms of approving merger of PSU banks may hamper their growth prospects in the medium term.

OPPORTUNITY
1. The market is seeing discontinuous growth driven by new products and services that include opportunities in credit cards, consumer finance and wealth management on the retail side, and in fee-based income and investment banking on the wholesale banking side. These require new skills in sales & marketing, credit and operations. 2. Banks will no longer enjoy windfall treasury gains that the decade-long secular decline in interest rates provided. This will expose the weaker banks. 3. With increased interest in Pakistan, competition from foreign banks will only intensify. 4. Given the demographic shifts resulting from changes in age profile and household income, consumers will increasingly demand enhanced institutional capabilities and service levels from banks. 5. New private banks could reach the next level of their growth in the Indian banking sector by continuing to innovate and develop differentiated business models to profitably serve segments like the rural/low income and affluent/HNI segments; actively adopting acquisitions as a means to grow and reaching the next level of performance in their service platforms. Attracting, developing and retaining more leadership capacity 6.Reach in rural Pakistan for the private sector and foreign banks.

THREATS
1. Threat of stability of the system: failure of some weak banks has often threatened the stability of the system. 2. Rise in inflation figures which would lead to increase in interest rates.

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3. Increase in the number of foreign players would pose a threat to the PSB as well as the private players.

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SWOT ANALYSIS of Company

Strength
State Bank of Pakistan is government owned bank that is why Pakistani nation has a trust on the bank that their deposits are secured. Due to this reason the deposits of the banks are increasing with the passage of time.

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1. Agent of State Bank of Pakistan

National Bank of Pakistan also works as an agent of State bank of Pakistan in those cities where SBP branches are not working.

2. Agency Arrangements
National Bank of Pakistan is enjoying with deposit of different Govt. organization like Pakistan Railways, PIA, WAPDA, Sui-gas due to agency arrangements.

3. Deposits
National bank of Pakistan is the largest commercial bank of the country and has Total Deposits of Rs. 362.87 billion and becomes the first bank to cross the deposit of Rs. 350billion. 4. Profitability The pre-tax profits of NBP have gone up to Rs. 6.05 billion. 5. Corporate Branches National Bank of Pakistan is now the biggest financial institution with assets totaling over Rs.310 billion with 1428 local and 23 foreign branches. The bank is the higher financer in agriculture and commodity operation sector.

6. Collection of Cash from Shrines

Cash collected from different shrines is also deposited in National Bank of Pakistan. 7. Comprehensive Range of Financial Products and order to facilitate the customers, NBP is offering the comprehensive range of financial products which are as follows: Credit Cards Foreign Exchange Bearer Certificates

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National Bank Daily Accounts Travelers Cheques etc

8. Investing in Capital Market

NBP has decided to diversify the fund base by investing in capital markets not only in Pakistan but also in the foreign countries

Weakness
1. Lack of Implementation of Rules and Regulations Because NBP is a govt. owned organization so there is a lack of implementation of rules and regulations.

2. Poor Working Conditions

Despite, cultural change program the working condition of the NBP is not up to standard. 3. Recruitment Policy In NBP, employees are recruited on the basis of favoritism or through other tools of corruption.

4. Incompetent Staff
Due to wrong recruitment policy staff of NBP is not proficient in their work.

5. Irregularities in Promotion
In NBP there is no smooth and continuous promotion system. Unfair means are used in order to get the promotion especially the promotion of the managers. 6. Individual Difference In NBP the individual difference have strong impact on the organizations performance due to the wrong criteria of selection of the employee. So with the passage of time

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individual differences are increasing which are undermining the good will of the organization.

7. No Major Use of Computer

In NBP there is no major use of computer for maintaining the records of branches as compared to other banks of the country.

8. Strong Union
Union has strong impact on performance of NBP. So the top management is unable to punish the violators and shrieks.

9. Organizational Structure
In this organizational the organizational structure is bureaucratic which is barrier in rapid and effective decision making.

OPPORTUNITIES 1. Consumer Banking

The basis need of the consumer such as housing, transportation and other durable goods are not adequately financed by the banks. So by initiating these services, the bank can enjoy with more funds.

2. Investing in the Foreign Capital Market

NBP can enjoy handsome return its funding base by investing in capital markets in the foreign countries.

3. Investment Banking
Until recently the bank perceived as purely commercial banking entity so in order to expand its business the bank may start investment banking by investing in the portfolio of

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handsome return.

4. New Branches
NBP by establishing new branches in foreign countries can expand its business and can enjoy with the profit.

5. Issuance of Bonds
To enjoy with large amount, NBP can introduce a comprehensive range of bonds.

6. Night Banking
Despite of poor customer service of NBP, people still come to NBP because of its Govt. ownership as they feel it secure therefore bank improve its deposit by giving facility of night banking and also can compete its competitors with positive steps.

7. Advisory Services
It can establish advisory services in order to facilitate the customers in investing in the securities.

Threats 1. Competition
The no. of banks in Pakistan is increasing with the passage of time. So due to poor working condition and poor customer service it may be possible NBP will lose its market share in future.

2. Inflation
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In our country, the rate of inflation is increasing along with the unemployment. So due to the increase in price of the products, the savings of the nation is decreasing with the passage of time. So it is the threat for the banking sector. In the future, the deposits of the bank will decrease.

3. Government Policy
On NBP Govt. policies have strong impact. A slight change in Govt. policies may affect the performance of the bank. The bank has to work with in the regulation frame work.

PROBLEMS
1. Customer Satisfaction
In NBP customer dealing is will, but during rush hour the customer has to wait for a long time for their turn. It is quite hard for a new customer or potential customer to get the required information.

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2. Poor record management and Billing system

During my internship I observed that filing system of branch is not good. When certain record is needed the staff has to struggle to find it out and a lot of time is wasted both by the staff and customer as well also old filing and registering system are being used yet.

3. Unequal distribution of work

Work is not equally distributed. On one hand some employee have to work all day without relaxing while some others have nothing to do at all. This not only creates confusion among employees but also hurting and disturbing for overall setup of the bank. And above all it results in dissatisfaction among customers as well.

4. Marketing efforts
A useful mode of contact is through personal marketing visits or efforts. Such visits are important in informing and perusing the existing and potential customers about the products and creating a sense of belongingness with them. By this way a branch manager increases their deposits and create more advances. The ultimate result is increase in the banks deposits as well as supreme motive that is profitability.

5. Less staff
Staff of the branch is less and workload is too much on the existing staff. Due to which they are unable to give proper time to their customers. Sometimes due to this shortage of time they lose their good customers also from this shortage of staff they are unable to give proper time to recording and other functions of the bank.

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

Difference between theory and practice

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

1. Bank duty to maintain secrecy

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

2. Excessive paper work

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

3. More accounts fewer deposits

Efficient banking is one, which does not emphasize on number of accounts but on greater amount of deposits. NBP is more interested in increasing its number of account

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irrespective to its deposit. The main reason behind it is that bank does not provide personalize service to all the account holders and does not improve its quality and services

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

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

6. MORALE OF STAFF
Employees do their jobs because they cant live without that otherwise job isnt nourishing to them. Though they are hope full about their promotions etc but desired behavior is rarely seemed in the employees of NBP. Some employees are highly denominated.

RECOMMENDATIONS
1. PROPER PLANNING Bank should make a plan to gear up its recovery efforts on war footing and reorganize the Recovery functions of global bases. In addition, bank should tighten up control on expenditure.
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2. USE OF Online Banking

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

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

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

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

6. CHECK ON EXPENDITURES

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Expenditures must be controlled which are very high and unnecessary.

7. BORROWING AT LOW COST

Deposits must be taken at a lower cost and given at higher interest rate

Conclusion
I got a lot of practical experience from National Bank during my internship. During internship I came to know that how different activities take place in organizations, what are the different rules and procedures followed in National Bank. National Bank of Pakistan is one of the leading bank in Pakistans Banking industry with almost 1300 + national and almost 25 branches in foreign countries. The bank is still growing and
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growing and on the way of expansion and prosperity. The management is highly qualified and experienced in its fields. I had a very great opportunity to work as internee so as to gain an over view of practical life and working in industry before entering in practical life. Practical things and knowledge is very much different from the theory and bookish knowledge. I had a very great chance to gain practical experience and to implement my bookish and very refine theoretical knowledge in practical things.

Bibliography
http://www.scribd.com/doc/18188073/National-Bank

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http://www.scribd.com/doc/21384472/NBP-Internship-Report www.nbp.com.pk/ Abrar Ahmad (PBO) http://www.scribd.com/doc/37679486/27/Functions-of-Clearing-Department

Appendices
Internship offer Letter Internship Completion Letter Employer Evaluation Form

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